New York Cannabis Sales To Approach $900M This Year Amid Retail Expansion
November 5, 2024New York adult-use cannabis sales are forecasted to reach $895.1 million for 2024, according to a new report on the state’s cannabis market from Whitney Economics. The report, which addresses the New York adult-use retail market from its sluggish start through today, estimates that the state’s cannabis companies are only reaching 15% of the Total Addressable Market (TAM), estimating that a fully realized cannabis market in New York could reach nearly $6 billion in annual sales. Those projections only include New York state residents, and do not account for the potential for more than $500 million in sales from the 60 million tourists who visit New York annually.
This year has seen a massive jump in legal, adult-use sales, even before the full year’s total is tabulated. For the first nine months of the year, the state saw $651 million in sales, more than double the 2023 total of $264 million, split between $150 million in adult-use and $114 million in medical sales. Last year, the New York market was hamstrung by lawsuits and a slow licensing program that disadvantaged vertically integrated and established cannabis companies. This year, due to changes in the state’s priorities and the resolution of lawsuits, the number of active dispensaries jumped to 204, with the market beginning to effectively address consumer demand.
That retail push is set to continue. The data from Whitney shows that there are 823 approved or in-process licenses for cannabis retailers, with fewer than a quarter of those currently open to consumers. Whitney estimates that the state would need over 1,200 retail dispensaries to match 75% of demand.
At the retail level, according to the data, many dispensaries are thriving as more consumers are able to participate in the legal market. Weekly sales for the state are around $20 million, which—with the current number of operating dispensaries—means each store’s run rate is around $5 million per week.
Looking ahead, Whitney estimates that sales will reach $1.3 billion for 2025, $3.3 billion for 2027, and over $4.5 billion annually by the end of the decade. While the state’s adult-use market is growing, this year’s projection of $891.5 million would make New York only the 15th-largest market for cannabis retail sales, despite being the fourth-largest market in the U.S.
Despite New York’s slow launch, forward-looking data for the state is promising. Based on adult-use markets in other states, New York can hope for legal cannabis sales to make up 80%-85% of all cannabis sales when the market reaches its full potential. By summer 2024, New York was only at 15% legal participation, lagging the 40%-45% of other states at this point in their legal rollout. With the state now aggressively approving more licenses, its cannabis market is now on the road to fulfilling its vast potential.—Shane English
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